The budget carrier on Monday (26 July) posted a €273 million (£234 million) net loss for the three months to 30 June, down from €185 million (£158 million) during the same period last year.
Boss Michael O’Leary said Covid-19 was continuing to "wreak havoc" on business, citing the cancellation of "most" Easter flights and a "slower than expected" easing on EU travel restrictions.
O’Leary said "significant uncertainty" around travel green lists, particularly in the UK, and "extreme government caution" in Ireland had ensured the majority of Q1 bookings were "close-in" and sold at low prices.
However, O’Leary said the prospects for Q2 were brighter owing to the 1 July roll-out of the EU Digital Covid Certificates and the scrapping of quarantine for fully vaccinated amber list arrivals to the UK from mid-July, which O’Leary said had resulted in a "surge in bookings" in recent weeks – although Ryanair declined to disclose further details of this surge.
It expects traffic to increase from around five million in June to almost nine million in July and to exceed 10 million in August, providing there are no further "Covid setbacks" in Europe.
Ryanair carried 8.1 million passengers in Q1, up from just 500,000 this time last year. Load factors increased too from 61% to 73%. Revenue of €371 million (£318 million) was overshadowed, though, by operating costs of €675 million (£578 million).
O’Leary said while Ryanair expected intra-European capacity to be "materially lower for the foreseeable future", it could create opportunities for the carrier which is currently taking delivery of a new fleet of more efficient aircraft.
Additionally, O’Leary said the pick-up in rates of vaccination across Europe was cause for encouragement. "If, as is presently predicted, most of Europe’s adult population is fully vaccinated by September, then we believe that we can look forward to a strong recovery in air travel for the second half of the fiscal year and well into summer 2022."
He compared the outlook to the situation that preceded a recovery in US domestic flight operations.
Ryanair had just over €4 billion (£3.43 billion) banked at the end of Q1, and had cut net debt to €1.66 billion (£1.42 billion) down from €2.28 billion (£1.95 billion) at the end of Q4 2021 (three months to 31 March).
O’Leary, though, said full-year 2021/22 would yet be challenging, with travel restrictions prolonging uncertainty – driving down fares and lead-in times.
"With the booking curve remaining very close-in and fares well below pre Covid-19 levels, visibility for the remainder of FY22 is close to zero," said O’Leary. "It therefore remains impossible to provide meaningful FY22 guidance at this time."
O’Leary said he expected traffic for full-year 2021/22 to come in at 90 million to 100 million, narrowing from a range of 80 million to 120 million, and that Ryanair was cautiously anticipating a full-year financial result "somewhere between a small loss and breakeven". "This is dependent on the continued roll-out of vaccines this summer, and no adverse Covid variant developments," said O’Leary.
He added that beyond the recovery from Covid-19, the airline would emerge with a "materially lower cost base" and a younger, more efficient fleet into and an aviation landscape where competitors have either had to cut capacity, or have failed.
"We are seeing a strong rebound of pent-up travel demand into August and September, and we expect this to continue into the second half of FY22, with pre Covid-19 growth planned to resume strongly in summer 2022."
